Breaking: HUBZone Appeals Coming Soon!

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SBA has released its proposed rule allowing for HUBZone appeals to go to the Office of Hearings and Appeals. Below are the key items from this proposed rule, and how it will affect potential and current HUBZone companies.

SBA issued the final rule on April 10 and it will become effective on May 10. As we wrote about a few months back, the HUBZone appeals rule will allow appeals from adverse status determination protests for certified HUBZone small business concerns. The inclusion of HUBZone appeals was written into the National Defense Authorization Act for Fiscal Year 2022.

Notably, there were no comments on the proposed rule, which we have additional details in our earlier post, but here are some key things to look out for. Be sure to check these rules closely if you are involved in a HUBZone protest and potential appeal.

  • Timing: HUBZone “appeals must be filed within ten (10) business days after the appellant receives the protest determination.” Note that this is a different timeline than the 15-calendar day rule for size protest appeals found in 13 C.F.R. 134.304(a). Responses are due within 15 days after the appeal. Decisions should come within 45 days after close of record.
  • Who may Appear? A protester may appear in the appeal and file a response.
  • Effect of an Appeal. “[W]here an appeal is filed before contract award, the contracting officer must withhold award until the appellate decision is rendered, unless the contracting officer has determined that award and performance of the contract is in the best interests of the government.” For an appeal after contract award, a CO must merely “consider whether performance can be suspended.”
  • Standard: Whether the protest “determination was based on clear error of fact or law.” This is the same standard as used in other OHA appeals, and can be tough to meet in some circumstances.
  • Who decides the appeals? The judges at SBA Office of Hearings and Appeals will decide HUBZone appeals, rather than the Associate Administrator for Government Contracting and Business Development. OHA appeals for HUBZone status determinations will still not include an avenue for appealing a denial of a HUBZone certification application.

It will be interesting to see if this appeal process has any substantive affect on the HUBZone program. Regardless, it will add transparency to the HUBZone protest process. Stay tuned for more updates as we start seeing HUBZone appeal decisions trickle in.

Questions about this post? Email us. Need legal assistance? call at 785-200-8919.

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